Study On The Path Of Manufacturing Industry Capacity Cooperation And Upgrading Promoted By China’s OFDI In The Background Of "The Belt And Road"

When New China was founded,it was a typical agricultural country with a very weak industrial base,imperfect industrial system and relatively low level of industrialization.After more than 70 years of construction and development,China’s manufacturing industry has made great historic achievements.According to the data of the United Nations Industrial Development Organization,the added value of China’s 22 manufacturing sectors ranks among the top in the world,and the output of100 major manufacturing products ranks first in the world.China has become a major manufacturing country with the most complete industrial system and the most complete industrial support in the world,as well as the world’s main processing and manufacturing base.However,from the perspective of manufacturing added value,the position of China’s manufacturing industry in the global value chain still has room to rise.In order to effectively alleviate excess capacity and improve the position of China’s manufacturing industry in the global value chain,Chinese government have encouraged enterprises to expand overseas investment cooperation,and optimize the distribution of manufacturing locations.In 2013,China put forward the “Belt and Road”Initiative,which provided an opportunity for China’s OFDI and production capacity cooperation.Under the dual incentive of "going global" and "production capacity cooperation",Chinese enterprises’ investment in countries along the Belt and Road has grown rapidly.By the end of 2020,China had set up more than 10,000 overseas enterprises in 63 countries along the "The Belt and Road",covering 18 industries of the national economy.The investment flow accounted for 14.7% of the whole year,among which manufacturing accounted for the largest proportion.In this context,this dissertation puts OFDI and international industrial capacity cooperation in manufacturing under one framework,based on the eclectic theory of international production,the endowment theory of production factors,the theory of comparative advantage and the theory of investment motivation,this paper intends to conduct an in-depth and systematic analysis of the effect and path of OFDI on production capacity cooperation and upgrading in the manufacturing industry.Manufacturing capacity cooperation between China and countries along the "The Belt and Road" can be divided into resource-intensive,capital-intensive and labor-intensive capacity cooperation according to different production factors.Based on the measurement of international capacity cooperation level by using trade complementarity index,the following four parts of empirical analysis are carried out:Firstly,the impact of OFDI on manufacturing capacity cooperation is analyzed,and panel model and intermediary model are used to analyze the effect and path of OFDI on different intensive capacity cooperation between China and countries along the "The Belt and Road".Secondly,the impact of production capacity cooperation on manufacturing upgrading is analyzed.The error correction model is used to analyze the impact of international production capacity cooperation between China and countries with different levels of development on China’s manufacturing upgrading at the national level.Thirdly,it analyzes whether there is the intermediary effect of manufacturing capacity cooperation in the process of OFDI’s influence on manufacturing upgrading.It applies the intermediary model and the differential difference model to make an empirical analysis on the effect of manufacturing upgrading of OFDI and the promotion of manufacturing upgrading by OFDI through manufacturing capacity cooperation at the provincial level in China.Finally,using the system dynamics model,ASEAN is selected as the characteristic representative of the countries along the Belt and Road,and the system of OFDI-production capacity cooperation-industrial structure upgrading between China and ASEAN is constructed.Based on the empirical analysis results of the above three parts,the countermeasures are simulated,and the influences of different OFDI policies on the model effects are discussed.The study conclusions of this dissertation mainly includes the following six aspects:First,when China and countries along the Belt and Road conduct industrial capacity cooperation in different intensive industries,the impact of OFDI on industrial capacity cooperation will play its role through the same path and different paths.In the same way,in all industries,OFDI will affect production capacity cooperation through technological progress.Among them,in the bilateral cooperation in resource-energy-intensive and capital-intensive industries,technological progress will promote production capacity cooperation.In the process of labor-intensive industry cooperation,technological progress will hinder production capacity cooperation.The different paths are as follows: OFDI has an employment promotion path for labor-intensive industrial capacity cooperation.OFDI increases the employment number of relevant industries in the host country and has a negative impact on China’s export.On the other hand,there are financing channels and paths for the production capacity cooperation in capital-intensive industries by OFDI.The continuous injection of OFDI provides funds for the host country,alleviates the capital shortage of the host country,improves the production capacity of the host country in capital-intensive industries,and promotes the production capacity cooperation between the two sidesSecond,when China conducts production capacity cooperation with different countries or regions,the path of promoting the upgrading of domestic manufacturing industry is different.In the long term,when China conducts production capacity cooperation with countries along the Belt and Road,both labor-intensive and capital-intensive production capacity cooperation can promote the upgrading of the domestic manufacturing industry.In the process of production capacity cooperation with developed countries,the upgrading of manufacturing industry is mainly promoted through the increase of import and export of resource-intensive industries.From the perspective of short-term impact,the technological progress path of production capacity cooperation has the strongest effect on correcting the deviation of manufacturing upgrading,followed by the accumulation of material and capital stock,and the effect of correcting industrial upgrading through domestic market consumption demand is relatively weak.Third,OFDI has a U-shaped effect on the upgrading of China’s manufacturing industry.In the short term,OFDI will inhibit the rationalization and advanced development of manufacturing industry,but in the long term,with the continuous accumulation of OFDI stock,it will significantly promote the rationalization and advanced development of manufacturing industry.The influence of OFDI on different production factor intensive industries also has heterogeneity.Fourth,the path analysis of OFDI and manufacturing industrial capacity cooperation and upgrading found that both labor-intensive and capital-intensive industrial capacity cooperation can effectively promote the upgrading of manufacturing industry,while the labor-intensive industrial capacity cooperation has a greater promoting effect.The increase of total factor productivity and the financing constraint of domestic investment are also effective ways for OFDI to have an impact on manufacturing upgrading.Domestic investment and financing constraints will inhibit capital intensive industries while stimulating the development of labor intensive industries,so it will have a negative impact on the upgrading of manufacturing industry.The increase of total factor productivity will promote technological progress,which will effectively promote capital-intensive industries and weaken labor-intensive industries,so it will have a positive impact on the upgrading of manufacturing industry.However,technical efficiency cannot have a significant impact on manufacturing upgrading for the time being.Fifth,the policy effects of the “The Belt and Road” Initiative on production capacity cooperation are different.After the initiative was put forward,the positive promoting effect of OFDI on industrial capacity cooperation in capital-intensive industries declined,but the promoting effect of OFDI on resource-and energy-intensive industries increased significantly,the negative inhibitory effect on labor-intensive industries’ export capacity cooperation is also declining,and with the increase of OFDI,the marginal effect of the Belt and Road Initiative on capacity cooperation is gradually increasing.In countries along the belt and Road bordering China,OFDI can play a greater role in promoting production capacity cooperation.After the "The Belt and Road" Initiative was put forward,the rationalization level of China’s manufacturing industry has been significantly improved,but the level of advanced manufacturing has declined.In the key development provinces of "The Belt and Road",the level of advanced manufacturing industry will be higher than that of non-key development provinces,but the degree of rationalization will be lower.Sixth,by expanding the scale of China’s OFDI to ASEAN,it has a certain impact on the promotion of production capacity cooperation between China and ASEAN and the upgrading of China’s manufacturing industry,but the effect is relatively limited.By reducing the proportion of resource-intensive OFDI,it can promote the enhancement of capacity cooperation and the upgrading of the capital-intensive manufacturing industry.However,the promotion and enhancement effect will be weakened as the proportion of resource intensive investment decreases.For labor-intensive manufacturing,the reduction of the proportion of resource-intensive outward investment will bring a dampening effect.The reduction of import penetration of capital-intensive products,namely,the enhancement of domestic great circulation construction,can effectively promote the upgrading of domestic manufacturing industry,and will not have a negative impact on international production capacity cooperation at the same time.